Allen Fuller

Buying Gold for Oil Like George Soros

Following a ratio is just one reason to buy gold. Inflation and the bear market in general are several other good reasons.

Oil is a fossil fuel, both literally and figuratively. It is going the way of the dinosaurs. It will become increasingly expensive until the pain is so bad we will flee to alternatives, or our economy collapses enough to reduce demand. Its recent drop in value was just a small correction on the overall larger (multi-year) upward trend. We will probably see oil prices stagnating around this level for the next few months or even a year or two, but in the long term, if the prices haven't destroyed demand sufficiently already, they will head back up again.

We need to stop looking at the daily and weekly view and take a good hard look at the bigger picture.